Each of these growth strategies requires the appropriate IS model to support it. For the product leadership and operational excellence models, the IS organization tends to be a support function focusing more strongly on internal customers. But for customer intimacy, the IS organization moves into the front office and focuses strongly on the external customer. This often leads to the most radical changes in the IS organizational model and in the skills needed to support it.
To be customer-centric, the IS organization must be flexible and agile and able to respond quickly and efficiently to customer needs. IS must evolve its capabilities and organize around the customer. The degree depends on the enterprise's customer strategy.
Put simply, being customer-centric means getting close enough to customers to understand their needs. For many CIOs this has meant using the Gartner IS Lite model to reorganize IS. IS Lite advocates pushing IS resources into the business (either the business processes or customer segments), retaining a core of key skills and, if needed, outsourcing some IT services provision.
The skills or capabilities now required to be customer-centric are often found in consulting organizations. Many CIOs talk in terms of reshaping IS to be more like a consultancy, offering key skills and services across the enterprise. These skills focus on being able to identify a customer's needs and translate them quickly and efficiently into a solution.
Another way to make IS more responsive to the needs of the customer is to put IS resources into the customer-facing organizational units, such as business processes or segments. Typically, many enterprises locate relationship managers and business analysts in the front office who then work closely with executives and feed demand signals back into the core of IS.
The amount of resources going into the customer-facing groups depends on a number of factors. Typically, a product leadership approach often only requires relationship management in product and service groups, and sales and marketing. Operational excellence and customer intimacy strategies require relationship management, business analysis and, in some cases, project management by business process.
However, many CIOs and business executives express frustration with the relationship management role. Their argument is that the role is too weak and not responsive enough to the customers' demands. For this reason, they are bolstering the relationship management role, adding in an external customer-facing component, such as responsibility for customer information, and making relationship managers more responsible for projects and service levels in their areas.
Agility and responsiveness to customer needs are key to being customer centric. For operational excellence and customer intimacy, customer needs must drive IS prioritization. This requires business executives, embedded staff and core IS groups to work closely together in a coordinated way. There are four key mechanisms to do this.
Governance Designing an effective governance model allows key decisions to be made quickly and effectively. The governance model identifies key decision domains — typically project identification and prioritization, and project management — and defines the key stakeholders from business executives through to core IS, and the process by which decisions are made.
IT processes Many IT processes are customer facing and run across the entire IT organization — for example, a root cause process that begins when a customer having trouble with a Web site contacts a help desk. These calls would initiate a process that would involve stakeholders across the business and IS in resolution and, along the way, might uncover an innovative way to make the site easier to use.
Competency centres Many enterprises consolidate key IS support skills into "competency centres". Such skills can include project management, enterprise architecture, business modelling and, where it's widely used, SAP. Competency centres provide frameworks, templates, methodology and advice. These centres have an integrative function, as they offer a standard approach to the whole of IS.
Culture But the most powerful, and subtle, linking mechanism is a customer-facing culture, with the dominant beliefs, values and behaviours emphasizing the generation of superior customer value and the continual quest for new sources of advantage. Such a culture emphasizes teamwork and collaboration.
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.